To run as profitable a business as possible, you first need to make sure that numerous elements are in place. Realistic goals, excellent products, a complete understanding of your customer base, and the right equipment are just a few of the necessities that will be required to ensure your success. One further component that should absolutely not be overlooked? Finding the right merchant services account.
What is a merchant services account?
In general, merchant services refers to the complete suite of finance-related choices that are available to businesses wishing to accept payments from their customers. In today’s digitally focused payments landscape, that usually means providing a diverse set of payment options, including credit and debit cards, contactless payments, ACH transfers, and even cryptocurrency. Additionally, the right merchant services provider should also be equipped to help you set up your payment gateways and customer loyalty programs, while providing all of the hardware and software necessary to accept payments and streamline their back office.
In general, you should expect your merchant services provider to provide you with the following:
- A merchant account. This is the secure repository where your payment services provider can deposit your funds after the completion of a credit card or other electronic payment.
- Online and in-person credit card processing. This includes both hardware point of sale solutions and the software that runs them.
- Payment gateway. This web-based software acts as an intermediary between you and your ecommerce customers and allows you to securely and seamlessly accept online payments.
- Online processing software. Think of this as a database management system that integrates with your other business functions. Once it’s in place, you can use it to keep track of the inventory you have sold and to credit purchases to customers in your database. This can be the cornerstone of your customer relationships management, inventory, and marketing strategies.
- Point of sale system. This includes everything necessary to process payments, including hardware and software that allow for simplified employee, customer, and inventory management.
- Loyalty programs. Once this feature is connected to your payment processing software, you can reward your repeat customers for their continued business.
As you can see, your merchant services provider can offer numerous helpful features to your physical or online store that go far beyond simply providing a secure bank account where the proceeds from your transactions will be deposited. When you do your homework and pick a payments partner that most accurately meets your needs, you will quickly realize the advantages that such a relationship can offer.
1. The ability to accept electronic payments.
Not so long ago, many retailers could function quite nicely accepting solely cash and checks. However, any merchant serious about attracting a loyal consumer base in today’s retail environment must also accept credit and debit card payments at the very least. With each passing year, more and more buyers are also opting to make purchases using alternative methods that include mobile and ewallet payments, as well payments made via subscription-based, recurring models. With a merchant account in place, you can offer your patrons any or all of these options.
When you expand the ways you will take money from shoppers, you give them the variety of choices they are coming to expect. That not only keeps you in step with or even ahead of your competitors, it also incentivizes your buyers to visit often and spend more. After all, they are no longer confined to only pay with the coins and bills they have in their pocket at the time of purchase. Additionally, digital commerce is easier to track both by you and your customers, a fact that makes tasks like inventory management and product returns run more smoothly.
2. Enhanced security for you and your customers.
While great products and excellent service may attract customers, failing to protect their sensitive payment information from cybercriminals could send them running to your competitors. Fortunately, a top-shelf merchant services provider will be certified as complying with the Payment Card Industry Data Security Standard (PCI DSS), a structured set of guidelines for safeguarding credit card data and preventing fraud through the documented use of rigid protocols, technologies, and procedures.
The recent upsurge in data breaches has customers more informed than ever about the importance of information security. When you choose a merchant service provider that is PCI-compliant and make that obvious to your customers with prominent signage both in your brick-and-mortar store and on your website, visitors will feel more confident about entrusting their credit card information to you. In the end, that will mean greater profits and more loyal patrons for your in-person or ecommerce operation.
3. The ability to accept international payments in native currencies
If you want to offer your products and services to buyers in other countries, there are many factors to consider. Perhaps the most important involves providing buyers with the ability to pay for your products or services in the monetary denomination they use every day. Expecting international customers to understand conversion equations and failing to streamline their purchase will inevitably mean that many would-be buyers click away to competing sites that are more accommodating to their native currency.
Your merchant service provider should give you all you need to accept payments in the currencies your customers prefer. Once you set up this feature, you can give total purchase transparency to your cross-border buyers, leading to greater satisfaction, less confusion, and fewer chargebacks.
4. Enhanced financial reporting in your back office.
As any small to mid-sized business owner knows, the things that go on behind the scenes to run the company are just as important as the buyer’s experience. Even the best sales and customer service will eventually fall flat if your back-office operations are in shambles.
The good news is that your merchant service provider should be able to provide you with merchant reporting tools that make some tasks more efficient while completely automating others. This streamlining is made possible thanks to the digital nature of many of your payments, as well as the software and hardware found in your point of sale solution. Here are just some of the reporting advantages that will literally be at your fingertips:
- Inventory management. That handy barcode scanner enables you to track the life cycle of your inventory from the time you receive it until it leaves your facility. Once you harness this capability, you will never be caught short again. Nor will you be saddled with surplus goods that no one wants to buy. With just a few clicks, you can instantly see the status of your warehouse at any given time, making it much easier to budget for future purchases.
- Payment reporting. Wouldn’t it be nice to be able to get a sense of how many payment transactions were made in a given period, with which methods, and with what foreign currencies? Thanks to your merchant service provider and the hardware and software you have integrated into your operations, you can easily gather this information at any time and from anywhere.
- Employee management. The same reporting capabilities that make your inventory and financial management easier can also help you more efficiently and effectively manage your staff. Easily print out a spreadsheet showing all team members' performance so that you can reward excellence and provide training for those who are struggling. Even time card management and vacation scheduling can be streamlined with the help of your system software.
In short, the equipment and software you get from your merchant service provider can transform your business in numerous important ways. Happy customers who receive the buying experience they want will inject extra money into your coffers while streamlined processes will facilitate more efficient and cost-effective operations. In the end, choosing the right merchant account and service provider will mean successful outcomes for both you and your valued customers.
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